Chapter 11 Overview

by Meagan Kania on September 29, 2010

Chapter 11 bankruptcy is referred to as “business reorganization” bankruptcy. It is specifically aimed at relieving the debts of businesses and corporations. If the Chapter 11 bankruptcy is confirmed the business is able to continue operations while leaving the business debtor in possession and leaving the business to continue normal operations. Filing for Chapter 11 bankruptcy requires the consent of the creditors. The creditors’ committee is presented with a debt repayment plan that typically explains how they will benefit. Creditors will only accept the plan if they believe they will receive more funds under the plan than from liquidation.

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